Cidara Inks Licensing and Collaboration Deal With J&J’s Janssen For Influenza Antiviral CD388

Cidara Therapeutics has entered into a worldwide licensing and collaboration deal with Janssen Pharmaceuticals, a unit of Johnson & Johnson, for the development and commercialization of Cidara’s Cloudbreak antiviral conjugates (AVCs) for the treatment and prevention of seasonal and pandemic influenza.

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Shares of Cidara Therapeutics (CDTX) were down by 1.9% in extended trading hours on April 5.

Cidara Therapeutics’ President and CEO, Jeffrey Stein said, “This collaboration represents a significant advancement toward fulfilling our vision of providing universal, seasonal protection against all seasonal and pandemic strains of influenza.”

“We believe Janssen, with its expertise in the development and commercialization of vaccines and therapies for viral respiratory diseases, is the ideal partner to rapidly advance CD388. Importantly, this agreement validates our Cloudbreak antiviral platform as we continue to advance our AVC programs in RSV, HIV and SARS-CoV-2,” Stein added.

As a part of this agreement, Cidara will receive $27 million as upfront payment and Janssen (JNJ) will fund all future manufacturing, commercialization, research, and development of Cidara’s influenza antiviral immunotherapy – CD388.

CDTX will also be eligible to receive $753 million in research and development funding, achievement of development, regulatory and commercial milestones, and will also receive tiered royalties on worldwide sales in the mid to high single digits.

This collaboration will also result in Cidara being responsible for the initial stage and Phase -2 clinical development and manufacturing of CD388 while Janssen will be responsible for the late-stage development, commercialization, and manufacturing of the AVC.

CDTX expects to file an investigational new drug application for CD388 with the US Food and Drug Administration (FDA) by the end of this year. (See Cidara Therapeutics stock analysis on TipRanks)

Following the agreement, Needham analyst Joseph Stringer assigned a Buy rating and a price target of $6 (129.9% upside) on the stock. Stringer noted, “We view the collaboration favorably given 1) near-term funding to CDTX, 2) provides some level of validation for the CDTX AVC platform/approach, and 3) adds potential long-term value w/ J&J expertise in vaccine development and commercialization.”

The rest of the Street is cautiously optimistic about the stock with a Moderate Buy consensus rating. That’s based on 3 analysts suggesting a Buy. The average analyst price target of $8.33 implies around 219.2% upside potential to current levels.

According to the TipRanks Smart Score system, CDTX scores a low 1 out of 10 indicating that the stock is highly likely to underperform the market.